State Street launched a second private credit ETF, the State Street Short Duration IG Public & Private Credit ETF (PRSD), on Sept. 10, 2025. It is a short-duration version of the SPDR SSGA IG Public & Private Credit ETF (PRIV), which was launched in February. PRIV, the original fund, received significant attention since it had proposed holding more private credit than the 15% limit on illiquid securities stipulated by Rule 22e-4 of the Investment Company Act of 1940. State Street received regulatory approval through an innovative agreement where Apollo “contractually agreed to provide intra-day, firm, executable bids” on private credit investments that Apollo sourced for the fund. Despite this, PRIV has had modest inflows, consistent with the moderate inflows this year into other U.S.-listed private credit ETFs (see Table 1).
PRSD, Like Its Predecessor PRIV, Has Limited Exposure to Private Credit
Although PRSD’s marketing materials emphasize private credit, 69% of the ETF’s portfolio was in treasuries, public corporate debt, and agency mortgage securities as of September 10, 2025 (see Figure 1). Of the remaining 31%, Apollo-sourced debt accounted for 22.2% of the portfolio. However, not all the Apollo-sourced debt can be considered private credit.
We estimate that, as of Sept. 10, only 9.9% of PRSD’s portfolio was in private credit. To calculate this, we analyzed each constituent using multiple factors, including the exposure type, identifiers, and TRACE (Trade Reporting and Compliance Engine) data. This private credit exposure primarily consists of business development company issued debt, direct private corporate loans, or commercial real estate collateralized loan obligations.
Aside from the holdings that we consider private credit, the remaining Apollo-sourced debt constitutes 12.2% of PRSD’s portfolio and primarily consists of other asset-based securities. This includes securities packaged from residential mortgages, aircraft loans and student loans, which we do not consider private credit based on trade and identifier data. So, if we examine PRSD’s exposure in aggregate, it is dominated by liquid traditional treasury and public corporate debt holdings, supplemented with some asset-based securities, with private credit making up less than 10% of the portfolio.
PRSD’s limited private credit exposure is consistent with the type of holdings in its predecessor ETF, PRIV. As of Sept. 10, we estimate PRIV as having had 8.4% of its portfolio in private credit, compared to 9.9% in PRSD. A key difference, however, is that PRSD has shorter duration exposure, with an option-adjusted duration of 2.02 years versus 5.83 years for PRIV, although this difference is largely due to the treasuries and public corporate debt. Additionally, PRIV has a much higher exposure than PRSD to public corporate debt (37% versus 28%, respectively), as well as to agency mortgages (22% versus 5%, respectively). PRIV has a significantly lower exposure to treasuries and cash (14%), compared to 35% for PRSD.
PRSD Is Highly Liquid Based on Observable Pre-Trade Bid/Ask Data
Seventy-six percent of PRSD’s portfolio by weighting is highly liquid, since the portfolio is dominated by very traditional treasury, agency mortgage and public corporate bond holdings. We used observable pre-trade bid/ask data, as aggregated by SOLVE, to assess the liquidity of PRSD’s underlying portfolio. We classified instruments that had more than 50 quotes in the trailing five trading days as highly liquid, those with between 0 and 50 quotes as moderately liquid, and those with no quotes as illiquid (see Figure 3).
Looking Ahead
PRSD currently has a very high exposure of 35% to treasuries and cash, much higher than the 14% in PRIV when it launched in February 2025. This higher treasury exposure in PRSD was likely required to maintain a short-duration portfolio. It will be important to monitor how PRSD changes its exposure over time and whether the fund rotates out of treasuries and into private debt. In the case of PRIV, the holdings in treasuries and agency mortgages have stayed stable over time. However, it has always had a much smaller portion of its portfolio in treasuries and increased its private credit exposure at the expense of public corporate debt holdings. Since PRSD has a much larger portion of its portfolio invested in treasury securities, it may need to eventually trim those holdings, assuming it can source appropriate short-duration private credit instruments.
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